Safran to Review Zodiac Warning Effect on $10.2 Billion Deal
- Zodiac says profit to drop 10% this year instead of increase
- TCI says Zodiac would be worth EU15 a share without Safran bid
Safran SA’s 9.6 billion-euro ($10.2 billion) acquisition of aircraft-seat maker Zodiac Aerospace SA, already facing opposition from an activist shareholder, was thrown into further disarray after Zodiac cut its outlook again, raising pressure on Safran to cut the price or abandon the deal outright.
Zodiac shares fell the most in more than a year, and now trade for 22 percent less than the Safran bid. Operating profit will fall 10 percent in the fiscal year ending in August, rather than the increase of 10 percent to 20 percent predicted earlier, Plaisir, France-based Zodiac said in a statement late Tuesday. Zodiac cited capacity bottlenecks at a Welsh plant that have again disrupted seat deliveries, together with holdups in the production of lavatories in the U.S. for planes such as the Airbus Group SE A350.